Publisher speculates about Amazon/Google e-book “duopoly”

Speaking at Princeton on Thursday, Richard Sarnoff, chairman of the …

Richard Sarnoff, chairman of the Association of American Publishers, speculated last week that the landmark Google Book Search settlement could create a duopoly in the electronic books market. Speaking at Princeton University's Center for Information Technology Policy, Sarnoff noted that Amazon currently dominates the market for downloadable e-books. He said that the settlement "forces Google to become a provider of electronic books with a different business model" in direct competition with Amazon. And he said that some aspects of the massive settlement would be "difficult to replicate" for Google's competitors.

Sarnoff said the publishers he represents didn't set out to create a monopoly in the markets for book search engines or online book sales. But he didn't deny that the settlement could have that effect. After all, he noted, "copyright itself is a monopoly."

Sarnoff also speculated that what competition does occur will "emerge thematically." That is, rather than building another comprehensive book search engine, competitors will offer niche search engines tilted toward particular industries, such as medicine. Legal hurdles may make it infeasible for any other firms to build a search engine comparable to Google Book Search.

A blueprint for 21st century book publishing

Sarnoff outlined the terms of the settlement, which is expected to be approved by the courts later this year. It reads like a blueprint for the future of electronic book publishing, covering topics as wide-ranging as advertising, library access, and the treatment of orphan works. A key element of the agreement is the creation of a Book Rights Registry that will collect payments from Google and distribute them to authors and publishers. Sarnoff said the publishers pressed for the creation of this registry in part because it would be too "easy to disintermediate the publisher over time" if Google paid authors directly. Sarnoff said that the structure of the registry will be "tough to replicate for [Google's] competitors."

Google made significant concessions to get the agreement. First, Google agreed to pay $60 for every scanned book whose rights-holders could be identified. In addition, rights-holders will have the power to decide whether to allow ads to appear alongside their books on Google's site, and will be entitled to advertising revenue if they choose to allow advertising. Finally, Google will help pay the plaintiffs' legal bills.

The agreement will create another important new revenue stream for authors and publishers: library subscriptions. Libraries will be able to pay fees to Google for access to the complete library of books in Google's catalog, and Google will pass most of those revenues along to publishers. Finally, the agreement has a provision that would provide free access to a limited number of terminals in public libraries for patrons who couldn't otherwise afford to buy e-books from Google.

No "transfer of files"

This might provoke a feeling of d�j� vu among those readers who signed up for Google's ill-fated online video store a few years ago. The new Google book store, like Google's earlier video store, will require users to log into their Google accounts in order to access the works they have purchased.

The agreement sets Google up as an e-book vendor, and Sarnoff said that measures would be taken to discourage the illicit sale of books purchased using Google's online store. Under the system he described, electronic books purchased from Google "will not be resident on your computer." Instead, the books will be stored on the Google "cloud," and users will access the books they have purchased a few pages at a time using a Web-based viewer. Apparently drawing a distinction between transient caching and permanent storage, Sarnoff said that the system Google has agreed to implement won't "involve the transfer of files."

This might provoke a feeling of d�j� vu among those readers who signed up for Google's ill-fated online video store a few years ago. The new Google book store, like Google's earlier video store, will require users to log into their Google accounts in order to access the works they have purchased. Users who want to read their e-books on their laptops while they are out of range of an access point will be out of luck. Finally, Sarnoff said that users' ownership of a book will continue only "as long as Google exists." If Google ever decided to stop supporting the online book service, as it did with its video service, users would be cut off from access to their books.

It's a bit of a puzzle what this DRM-like scheme is supposed to accomplish. Under the system Sarnoff described, it would be trivial to write a FireFox plugin to automatically page through a book, download individual pages, and stitch them together into a PDF. So although it will inconvenience legitimate users who want to read their lawfully purchased books without an Internet connection, we're willing to bet that it won't make a dent in book piracy.

Timothy B. Lee / Timothy covers tech policy for Ars, with a particular focus on patent and copyright law, privacy, free speech, and open government. His writing has appeared in Slate, Reason, Wired, and the New York Times.